The Discover IT card is one of the best rotating cash back credit cards on the market. In this post we will take a look at how to maximize quarter 1 for the Discover IT on purchases in 2020. In this quarter, which lasts from January 1st to March 31st, you will be able to earn 5% cash back in these three areas: Grocery store purchases, CVS, and Walgreens.
You will earn this 5% on the first $1,500 you spend at all three areas combined. The maximum amount you can earn will be $75. Just be sure to activate the quarter before you start spending.
HOW SOON CAN YOU ACTIVATE YOUR DISCOVER IT SAVINGS?
You can activate the Discover IT’s quarters 2 months prior to when the quarter begins. For example quarter 3 which lasts from July 1st to September 30th can be activated on May 1st. As you can see in the graphic below, the categories will be restaurants and Paypal. Stay tuned in the coming months when we will discuss the best strategies for maximizing how to earn you $75 cash back.
HOW TO MAXIMIZE QUARTER 1
Most should be able to take advantage and maximize quarter 1 for the Discover IT. Especially in this quarter in the Grocery Store category alone. According to the US Bureau of Labor Statistics in 2018 the average family spends $4,464 per year on groceries. That averages $372 per month.
Because every family’s needs are different, you will no doubt have to adjust accordingly. But for the sake of ease we will use the above numbers for this discussion. For the three months of January, February, and March the average family would spend about $1,116 in the first quarter alone. Only putting you $384 short of the $1,500 cap of earning 5% cash back.
What do most grocery stores, CVS, and Walgreens have in common? They sell gift cards. So what I would recommend doing is purchasing either gift cards to the grocery store you like shopping at since you know you will use it anyway. Alternatively, you could purchase a gift card or gift cards to places you know you will be able to use. Don’t purchase gift cards just to purchase them. You should do so with a clear plan in mind.
PRACTICAL APPLICATION
What does a practical way of putting this into practice look like? I live in the small town of Houston, Texas. Have you heard of it? Oh, you have? Well anyway, we have a popular chain here called Kroger. They sell a variety of gift cards.
Anyway my wife and I will be going to California this week for a wedding. While there, we decided to go to Disneyland for a couple days. Kroger sells, you guessed it, Disney gift cards. I purchased $1,000 of Disney gift cards with my Discover IT card. Basically saving my $50.
Now I will get that $50 in the form of available cash back on my Discover IT account that I can use towards my balance or deposit into my bank account. What is great about Discover is if you are still within your first of having this card they will match all of your cash back at the end of your first year. So essentially you could save 10% or $150 each quarter instead of $75.
ANOTHER BENEFIT OF BUYING GIFT CARDS
Another great way I save money when purchasing gift cards at Kroger is being able to take advantage of the promotions they have. Kroger has a fuel rewards program. You earn 1 point per dollar you spend. For every 100 points you earn you can save 10 cents off per gallon of gas.
They usually have 2X fuel points on gift cards and just about every weekend it seems they will allow you to earn 4X fuel points on gift cards.
So my $1,000 Disney gift card purchase earned me 2000 fuel rewards. If it weren’t for my poor planning and waiting until the last minute I could have taken advantage of the 4X fuel rewards that is currently running and earned 4000 fuel rewards.
Kroger allows you to redeem 1000 fuel rewards maximum per transaction. So the most you can save is $1.00 off per gallon. Depending on how many gallons of gasoline it takes to fill up that could be some serious savings. Keep in mind that fuel rewards usually expire within a month. So you won’t want to hoard them.
DO YOU WANT A FREE $50?
If you’re thinking about getting this card now is a great time. You can use this link to apply and get a free $50 as long as you make one transaction within the first 3 months of opening your account.
OVERALL THOUGHTS
The Discover IT card is one of the easiest to use rotating categories credit cards to use. I love that it has no annual fee too. Discover also reveals the whole year calendar ahead of time to help you plan your spend accordingly. Quarter 2 will be Gas Stations, Lyft, Uber, and Wholesale Clubs. Check back for that one. So now that you know how to maximize quarter 1 for the Discover IT, are you ready to start saving?